UAE stock markets shed $120bn since the US-Israel war began, and the number buried in the tourism data makes it so much worse

The United Arab Emirates’ stock markets in Dubai and Abu Dhabi have collectively lost $120 billion in value since the US-Israel war on Iran began. That makes them among the hardest-hit financial markets globally since the conflict started on February 28.

Dubai’s benchmark index has plunged roughly 16 percent since then, while Abu Dhabi’s larger ADX General Index has shed around 9 percent. As detailed by Al Jazeera, the Dubai Financial Market General Index alone has seen about $45 billion wiped from its market capitalization, with the ADX General Index accounting for the remaining $75 billion.

Other regional markets have also felt pressure, though less severely. Qatar is down around 4 percent and Bahrain around 7 percent, while Saudi Arabia and Oman have managed gains over the same period. Wall Street’s S&P 500 has fallen about 7 percent, with the declines coming amid President Trump’s mixed messaging on the war’s goals and expected duration.

The tourism damage may be the harder number to absorb

The conflict has struck a significant blow to the UAE’s reputation as a regional travel hub, with tens of thousands of flights canceled, many involving routes through Dubai International Airport, the world’s busiest for international passengers.

Tourism and travel contributed roughly $70 billion to the UAE economy last year, representing 13 percent of its gross domestic product. Iran’s effective closure of the Strait of Hormuz has compounded the disruption, even if the UAE has not been as directly exposed to the broader energy shock as some neighbors.

Haytham Aoun, an assistant professor of finance at the American University in Dubai, described the slide as a “temporary shock” rather than evidence of deeper structural damage. He called it “clearly a short-term setback to investor sentiment and market confidence, but not necessarily a fundamental challenge to the UAE’s long-term economic plan,” adding that international financial centers are ultimately judged by the quality of their regulation, liquidity management, and institutional resilience.

Separately, Iran’s oil revenues have reportedly climbed to nearly double their pre-war levels despite the ongoing campaign. The UAE’s stock markets are relatively small by global standards, but the country has invested heavily in financial services as part of broader economic diversification efforts.

Last year, the value of UAE-listed stocks crossed the $1 trillion mark for the first time, placing it second only to Saudi Arabia’s $2.5 trillion market in the region. Dubai climbed to seventh place in the latest Global Financial Centres Index, its highest ranking ever, and the country’s leaders have set a target of reaching the top four global financial centers by 2033 under a 10-year economic plan unveiled in 2023.

Burdin Hickok, a professor at New York University’s School of Professional Studies and a former US Department of State official in the Middle East, said the Dubai and Abu Dhabi exchanges are likely to see a “serious rebound” once a resolution is reached. He noted that oil price volatility tied to the conflict has sent ripples through global markets, but emphasized that the fundamental attractiveness of both UAE exchanges has not changed, with no regulatory or capital restrictions in place that would signal a more structural shift.